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Methanex to Idle Trinidad Titan Plant Amid Persistent Gas Shortages, TPH Says

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Methanex (MEOH) plans to idle its 860,000-metric-ton Titan methanol plant in Trinidad and Tobago later in 2026 after failing to secure a new natural gas supply agreement, TPH Energy strategists said in a note on Tuesday.

Matthew Blair, an analyst at TPH Energy, said the current feedstock contract is set to expire in Q3, after which the plant will cease operations. The decision follows years of weakening upstream gas production in Trinidad and Tobago, which has fallen steadily as legacy fields mature.

National natural gas output declined to 2,547 million cubic feet per day in 2025, down 29% from 3,592 mmcf/d in 2019. Though the domestic methanol sector has marginally increased its share of gas usage to 18% from 15% over the same period, overall methanol production in Canada has dropped 19% compared to 2019 levels.

Blair said industry utilization has also deteriorated, with Trinidad's methanol plants running at just 59% last year, producing 4.5 million mt against 7.6 million mt of installed capacity.

TPH noted that while Titan represents just under 10% of Methanex's 2026 equity production guidance of 9 million mt, the facility has not been contributing to EBITDA or free cash flow.

The bank attributed this to a pricing formula in Trinidad that links gas costs to methanol prices, compressing margins even during periods of elevated global methanol pricing. Higher shipping costs relative to Methanex's broader portfolio further weigh on competitiveness.

Blair said that, as a result, it is not revising its H2 2026 or 2027 EBITDA estimates, characterizing the impact as largely neutral from a financial perspective.

Elsewhere, Methanex also lowered contract prices for Asia in July, with China and Asia Pacific methanol deals set at $525 per metric ton and $620/mt, respectively, down from $610/mt and $740/mt in June.

The reductions align with TPH's expectations and reflect softer global pricing momentum, with Q3 global contract averages tracking about $47/mt lower than the prior quarter.

European contract pricing is still pending, but is expected to follow the downward trend.

Price: $47.49, Change: $-1.31, Percent Change: -2.68%

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